Informa to buy rival Ascential, easyJet quarterly profit rises

London open

The FTSE 100 is expected to open 25 points lower on Wednesday, having closed down 0.38% on Tuesday at 8,167.37.

Stocks to watch

Publishing and exhibitions group Informa on Wednesday said it was buying rival Ascential in an agreed £1.2bn deal. Ascential shareholders have been offered 568p a share in cash, a premium of around 53% to the closing price of 371p on July 22.

easyJet's third-quarter profit before tax increased £33m year-on-year, it reported on Wednesday, driven by an 8% rise in passenger numbers and a 1% rise in revenue per seat. The FTSE 100 low-cost carrier said easyJet holidays saw a significant growth in profit before tax by 49% to £73m, with a 33% increase in passenger numbers. It maintained a positive outlook for the 2024 financial year, expecting continued growth in revenue per seat and profit from easyJet holidays, alongside a stable cost environment.

Newspaper round-up

Reckitt is under pressure from top shareholders to revisit a sale of its nutrition business, following litigation and a series of other setbacks at the division that have sent the company’s share price to decade lows. The FTSE 100 consumer giant acquired the Mead Johnson infant formula business in 2017 for $17bn — its largest-ever acquisition — and it has been plagued by mishaps ever since. Meanwhile, the wider group, which makes Lysol detergent and Durex condoms, has underwhelmed investors as it struggles to build back sales volumes following a period of high inflation and suppressed consumer demand. – Financial Times

Earnings at Tesla almost halved as discounts and price cuts pile pressure on the electric carmaker’s profit margins. Elon Musk, the company’s CEO, blamed “a bit of a hangover” after rivals cut prices “very substantially, which has made it a bit more difficult for Tesla”. Tesla has sought to drum up interest in its plans for robotaxis, artificial intelligence and “genuinely useful” humanoid robots as deliveries slipped amid cooling demand. – The Guardian

Virgin Atlantic is to charge passengers a green levy on every flight as it seeks to cover the costs of using sustainable aviation fuel (Saf). Shai Weiss, the chief executive of the UK airline, confirmed plans for the environmental surcharge, which he said will come into force over the next 18 months. It comes as airlines gear up for the mandated use of Saf, which costs three times as much as kerosene. – The Telegraph

Informa is in advanced discussions to acquire Ascential, its rival events specialist, for £1.16 billion, providing a further boost to deal activity in the City. Ascential’s board said it is minded to accept the 568p-per-share offer from the FTSE 100 owner of the Miami Boat Show and World of Concrete. – The Times

Sir Keir Starmer’s plans for a housebuilding revolution risk breaching human rights laws, lawyers have said. They say the Government will face a string of legal battles over its proposal to reduce compensation to landowners forced to hand over their assets under compulsory purchase order (CPO) powers. As outlined in the King’s Speech, the Government wants to reduce how much money is paid to owners and developers for use in housebuilding, saying it wanted to make the payouts “fair but not excessive”. – The Telegraph

US close

Wall Street stocks closed lower on Tuesday as market participants got their first taste of big-name tech earnings for Q2.

At the close, the Dow Jones Industrial Average was down 0.14% at 40,358.09, while the S&P 500 lost 0.16% to 5,555.74 and the Nasdaq Composite saw out the session 0.06% weaker at 17,997..35.

The Dow closed 57.35 points lower on Tuesday, taking a modest bite out of gains recorded in the previous session.

Google parent company Alphabet met expectations with its latest quarterly earnings report but YouTube advertising revenues fell short of estimates, while electric carmaker Tesla's quarterly earnings nearly halved as price cuts put pressure on profits.

Elsewhere, soft drinks giant Coca-Cola hiked its full-year guidance on the back of increased global demand throughout Q2, while cigarette maker Philip Morris reported a 34% jump in quarterly profits amidst an "outstanding" quarter in which revenues topped estimates.